Every piece of land tells a story—but not just one. A single hillside might host livestock, shelter wildlife, whisper with wind in the trees, and hold carbon deep in its soil. To decide its future, we must ask many questions at once.
Is it more valuable as pasture or as forest? As income or as habitat? As a personal asset or a public good?
In Chapter 9 of Applied Environmental Economics, the authors attempt to answer all of these questions together—spatially, economically, ecologically—through a comprehensive cost-benefit analysis (CBA), powered by Geographical Information Systems (GIS).
This is the chapter where all previous insights converge. It is a symphony of data, a map of trade-offs, a decision tool for our time.
Why Cost-Benefit Analysis?
CBA is not new. It’s a well-worn economic tool, asking: do the benefits of a project outweigh the costs? But what makes this CBA different is its depth, its breadth, and its anchoring in place.
This analysis doesn’t ask about one project. It asks about every square kilometer of land in Wales.
- What happens if we convert this farmland to conifer woodland?
- Or that one to broadleaf?
- What do we gain in timber? Carbon? Recreation?
- What do we lose in farming income?
And most importantly: where is the balance tipped?
The Spatial Turn
Traditionally, CBA is done on spreadsheets. Numbers go in, results come out. But land is not a spreadsheet. It’s hills, valleys, roads, rivers, and villages. It’s gradients of value, not averages.
That’s where GIS transforms the analysis.
The researchers model every relevant variable—recreation, timber yield, carbon sequestration, agricultural opportunity cost—as spatial layers. Each 1 km² land cell in Wales is assigned its own set of values, based on local data.
Then they simulate different land use scenarios—converting sheep farms or dairy farms to either Sitka spruce or beech woodland—and calculate the net benefit for each scenario, for each cell, under various discount rates.
The result is not a number. It’s a map. A living portrait of economic possibility.
Insights from the Landscape
The patterns revealed are striking:
- In upland areas with poor soils and low farm profitability, the net benefits of afforestation—especially with carbon and recreation included—are often positive. These are lands quietly asking to be forests again.
- In productive lowlands, the opportunity costs of giving up dairy or crop farming often exceed the benefits of trees—unless carbon prices rise significantly.
- The choice of discount rate dramatically alters the picture. Lower rates (e.g., 3%) give more weight to long-term carbon and timber values, favoring afforestation. Higher rates (6%) make short-term farm profits loom larger.
- Tree species matter. Sitka spruce offers higher short-term timber returns. Beech offers better long-term carbon and amenity benefits, and interacts differently with soil.
Perhaps most powerfully, the maps show where policy intervention could be most effective—where small subsidies, access improvements, or public planting schemes could tip the balance in favor of societal benefit.
Market vs. Social Perspective
The authors also compare two viewpoints:
- Farm-Gate (Private) CBA – What does the landowner gain or lose?
- Social CBA – What does society gain or lose, including carbon, recreation, and subsidies?
This distinction is crucial. Some conversions may look unprofitable to a farmer—but highly beneficial to society. That gap represents a policy opportunity: to use incentives, grants, or education to align private and public interests.
Without this alignment, market forces alone will continue to undervalue what forests quietly offer.
The Ethics of Mapping Value
There’s a deeper question here too: Should we map value this way?
Does reducing landscape to costs and benefits cheapen its meaning? Or does it finally allow nature to speak in the language of policy?
This chapter suggests a careful answer: that maps and models do not replace wisdom. But they inform it. They show the shadows behind our choices. They help us move from vague good intentions to grounded strategy.
And they remind us that what we value depends on where we stand—literally.
Closing Reflections
Cost-benefit analysis using GIS is not just a technical exercise. It’s a tool for humility. It says: let’s not guess. Let’s ask the land, the numbers, the people. Let’s layer values—not flatten them. Let’s plan with vision, not habit.
In the end, the greatest gift of this chapter is a map of possibility. A way to see that land use change is not a binary fight between farms and forests—but a spectrum of outcomes, rich with nuance.
And within that spectrum lies a quiet invitation: to choose well.